MS. NULAND: All right, everybody. Happy Friday. We are out a little bit early because the Secretary is hosting Italian President Napolitano for lunch today. Not quite as early as we hoped to be out, but we have time for about half an hour.

I know, Brad, yesterday there was some question on budget. I don’t know if you want to start there.

QUESTION: That’s actually where I was going to start, so if we could get to, first, we saw the letter from Secretary Kerry. Is there any understanding yet of more precisely where these cuts would be affected in the event of a sequester?

MS. NULAND: Let me give you a little bit more detail with regard to how we’re looking at this. A sequestration would reduce the fiscal year 2013 funding for the State Department and AID by roughly $2.6 billion overall. Cuts of this magnitude would obviously severely impact our ability to execute all of our vital missions overseas, particularly in the areas of national security, diplomacy, development.

Let me give you just a few examples. A sequestration would cut foreign assistance by close to $1.7 billion. That could lead to reductions in assistance to Israel, to Jordan, to Egypt, and it could undercut our commitment to their security at such a volatile time. Sequestration would also force us to cut approximately $200 million from our humanitarian assistance accounts at the very time that we’re facing growing needs in Syria, in the Horn of Africa, in the Sahel. Similarly, we could be facing cuts of some $400 million in our global health funding, particularly in the areas of having to cut back on PEPFAR funding. Funding for day-to-day operations could also face cuts of around $850 million, including reduced funding for Diplomatic Security. Those kinds of cuts could force very, very difficult trade-offs for us in maintaining our global security posture. Finally, sequestration could undermine progress we’ve made to ensure that visa services are performed in a timely manner. You know how hard we’ve worked to cut the times. The Department of Commerce has estimated that one job is created in America in our travel and tourism industry for every 65 visas that are issued. So if we have to cut back on consular officers, et cetera, then the wait times can go back up.

Is that good?

QUESTION: Great. Within each section, are these cuts – take, for example, security, FMF funding. Would you cut those across the board per country, or do you have the leeway to decide which countries you would take more from and which countries you’d take less from?

MS. NULAND: My understanding is that we will have some flexibility within accounts, but I frankly don’t have that level of detail at this stage or even whether we can predict at this stage.

QUESTION: Are you worried about a deluge of requests and lobbying efforts from your foreign partners if, in fact, they know that you’re going to have to pull and tug from each side? Each one’s going to want to get, I guess, the least amount of cuts as possible, right?

MS. NULAND: I think it’s fair to say that interlocutors around the world are watching the budget debate in the United States, watching with some anxiety not only with regard to how it might impact our ability to interact with them but also what it says about our politics. So it’s obviously been a subject of discussion, but in terms of your particular question of countries lining up and fighting each other for pieces of the pie, we are not quite there yet.

Yeah.

QUESTION: But this watching with anxiety and what it says about our politics, what are they saying precisely? Are they --

MS. NULAND: At this point, they’re saying we hope you can work it out, you’ve had the resilience to work things out like this in the past, but we really need you to work it out.

QUESTION: So they believe in us.

MS. NULAND: They want to see us work it out.

QUESTION: When you talk about the department-by-department reductions, how do you arrive at the figure for each of those programs? Like you took about 200 million, 300 million here. Is it a percentage point of the overall budget for those programs, or --

MS. NULAND: Yeah, essentially. I mean, sequestration requires a total percentage cut and that these reflect how they would be allocated across the various different accounts that we have here.

QUESTION: So would you have flexibility within that to sort of say, “Okay. Well, we’re not going to take the money off the foreign military assistance program. We got to just take a larger lump sum off humanitarian aid,” for instance?

MS. NULAND: No. It doesn’t work that way.

QUESTION: It doesn’t work that way. Okay.

MS. NULAND: No. But if we need to go any deeper on this, I’ll get you some budgeters, because we’re at the end of my math skills here.

QUESTION: Do you have an idea of furloughs?

QUESTION: Toria, I didn’t understand your explanation to Brad.

MS. NULAND: Can we just --

QUESTION: Oh, I’m sorry.

QUESTION: Do you have an idea of how many employees might be furloughed?

MS. NULAND: Let me say that, at this point, no decisions have been made along those lines. But we are not in a position to rule out the possibility of furloughs.

QUESTION: Her question wasn’t whether the decisions – it was whether you have any idea of what furloughs might be necessary. Do you not have some kind of an estimate of whether there might be any?

MS. NULAND: Again, since we haven’t made any decisions about whether we’d have to go that route, I’m certainly not in a position to ventilate numbers.

QUESTION: You said these cuts will see cuts to aid that is given to Israel, Jordan, and Egypt. I don’t know if you asked this, Brad, but is it consistent with the amount of aid they’re getting? How is it done? Is it – are you selective of the --

MS. NULAND: Again, I believe that within accounts, we have some flexibility. But if that’s not right, I’ll get back to you.

QUESTION: Thank you.

MS. NULAND: Please.

QUESTION: Do you have any figures, assessment of the kind of effect this will have on your aid to Afghanistan, also in Pakistan? And secondly, would it have any impact on the Kerry-Lugar-Berman bill, which gives 1.5 billion to Pakistan every year?

MS. NULAND: I don’t have those kinds of details at this point, Lalit. If we have something to share with you, we will.

Okay. Moving on.

QUESTION: On North Korea.

MS. NULAND: Yes.

QUESTION: Since after the North Korea nuclear test, did the United States send any strong message to the North Korea through the New York channel?

MS. NULAND: Beyond what I said at the time of the test, that we had had contact in our regular channel, I don’t have anything to share for you with regard to direct contact. But certainly, we’ve been pretty clear publicly where we are.

Said.

QUESTION: The Palestinian issue.

QUESTION: Still on Korea.

MS. NULAND: Still on DPRK, yeah.

QUESTION: Yeah. Japanese Prime Minister Abe has publicly stated that when he comes to the U.S. next week, he’s going to ask that the U.S. re-designate North Korea as a state sponsor of terrorism. Do you have a response to this? Is this something that the U.S. would consider doing?

MS. NULAND: Well, obviously, we’re going to have our conversations with Prime Minister Abe when he arrives. Let me just step back on the broader issue of when and how we designate states as state sponsors of terrorism. As a matter of U.S. law, in order for a country to be designated as a state sponsor of terrorism, the Secretary of State has to determine that the government of that country has repeatedly provided support for acts of international terrorism. So these designations are made after careful review of the record of the country in question. So we regularly review our intelligence on North Korea to determine whether the facts would put them back in that category. I don’t, obviously, have anything to announce in terms of a change of posture today.

QUESTION: Just to follow up on that --

MS. NULAND: Please, still on North Korea?

QUESTION: Yeah.

MS. NULAND: Yeah.

QUESTION: The White House today is – that Mr. Tom Donilon will attend the ceremony of inauguration in South Korea with Ambassador Sung Kim. Are there any plans to have bilateral talks about North Korea during this trip?

MS. NULAND: Well, I would refer you to the White House as to whether National Security Advisor Donilon’s program is going to include just the ceremonial aspects or whether there will be meetings. Obviously, if there are meetings, I’m sure that that subject will come up. But I’ll refer you to the White House.

Please.

QUESTION: So according to the media, North Korea had told China that he’s going to prepare another one or two nuclear tests this year. Is any response with that?

MS. NULAND: Well, we’ve obviously seen these media reports. Let me take this opportunity to again say that the United States calls on the DPRK to refrain from additional provocative actions that would violate its international obligations and run counter to its commitments. UN Security Council Resolutions 1718, 1874, and 2887 demand that the DPRK not conduct any further nuclear tests. And as you know, in the UN Security Council Resolution 2087, the Council expressed its determination to take significant action in the event of a nuclear test.

And again, the DPRK is not going to achieve anything in terms of the health, welfare, safety, future of its own people by these kinds of continued provocative actions. It’s just going to lead to more isolation.

QUESTION: And which --

QUESTION: Any details about the sanctions?

MS. NULAND: About --

QUESTION: The sanctions?

MS. NULAND: Well, I think you know that we are in intense consultations in the Security Council with regard to the international community’s response to the most recent test. Those continue. I would refer you to our mission in New York.

Still on --

QUESTION: Yeah. Just on North Korea real quick. I just want to follow up on what you said about the process for the state sponsor of terrorism designation. I just want to – I know we talked about this a little bit, but I just want to go back to the legislation that was introduced by Representative Ros-Lehtinen on Monday. I know that that was asking you to consider putting them back on the list. Have you – in response to that, have you started this process of kind of looking into, like, what they’re doing, or where are you on that?

MS. NULAND: Well, first with regard to the legislation, my understanding is it’s draft legislation. We obviously wouldn’t comment on legislation in draft. But as I said, we are continually reviewing the intelligence that we have and make determinations with regard to what we see. So it’s not as if that process is ever stopped, if you will.

Please.

QUESTION: Toria, one more on that. I can’t remember if it was yesterday or the day before, you were asked about the possibility of additional sanctions on North Korea, and you made very clear that your focus was more on multilateral or UN sanctions rather than on U.S. bilateral sanctions. And I wanted to ask, leaving aside the question of whether or not the Secretary might determine that there was an evidentiary basis for putting them back on the State Sponsors list, is the U.S. Government giving any consideration to additional financial sanctions on the North?

MS. NULAND: I didn’t mean to imply yesterday that we were not continually looking at what we can do unilaterally, nationally, that might have impact. We are obviously always evaluating that. The point that I was trying to make, Arshad, was that, given the way the DPRK economy works, they are well sanctioned by us now but they would feel it more if it were international in terms of it causing their big neighbors in particular to do more.

QUESTION: Because there are, I mean, are there not – there are sanctions other than the State Sponsors ones that the U.S. Government removed from the North. For example, the Trading with the Enemy Act sanctions, which were removed. So there are still things you can do, correct?

MS. NULAND: We do have – we still do have some leeway. I would say that we continue to review what’ll be most effective.

QUESTION: Can I just ask you about this --

MS. NULAND: Yeah.

QUESTION: -- continually reviewing? You have people every day reviewing, what, every country in the world, whether they should they should be a state sponsor of terorrism, or do you already have a review underway specifically on North Korea?

MS. NULAND: Countries that have a track record of past terrorist activity that have been removed from the list are regularly reviewed to check whether that kind of behavior has resumed. So let me just put it that way.

QUESTION: Okay. So you have a kind of a task force, or just somebody who does a --

MS. NULAND: I don’t think I’m going to get into exactly the wheres and hows of this building, but let me just repeat again that with regard to North Korea, we regularly review the intelligence for resumption of terrorist activity.

QUESTION: (Off-mike.)

MS. NULAND: I think for intelligence reasons I’m not going to get into that right here, Lalit, but I will say that with regard to the DPRK it’s something we regularly review.

QUESTION: On these sanctions on North Korea, will the United States take any (inaudible) style of financial sanctions to pressure North Korea?

MS. NULAND: I think that’s the question that Arshad just asked, and I said that we continue to review what is appropriate.

QUESTION: So why is it okay to say that you have this review of North Korea regularly but it falls into intelligence to say any other countries in the world are being regularly reviewed?

MS. NULAND: The question had come up specifically with regard to the DPRK. Given their track record, the community was comfortable affirming that we do regularly watch them. But I don’t think it’s in our interest to go through the whole list right here.

QUESTION: Is Libya being regularly reviewed?

MS. NULAND: I don’t have anything for you on that.

Please.

QUESTION: Don’t you review the whole world?

MS. NULAND: Guys.

QUESTION: Just as a matter of law, right?

MS. NULAND: Well, of course we do. I mean, as a matter of law, we have to maintain, but there are certain places that we are particularly attentive to, obviously.

Please.

QUESTION: (Inaudible) militarization, the Government of Japan and South Korea are concerned so much about the militarization. This time, they might succeed, militarization of the nuclear warhead. How do you concern --

MS. NULAND: I think from our perspective, big or small, it’s still a violation of UN Security Council resolutions.

Please, Said.

QUESTION: Change topics?

MS. NULAND: Yeah.

QUESTION: The Palestinians? Bulgaria just deported a Hamas delegation that they had invited – that received on Wednesday. Do you welcome that action?

MS. NULAND: Again, this was a national decision for Bulgaria to make, based on their own evaluation of their security. So it’s obviously a sovereign decision for Bulgaria.

QUESTION: All right. Did the United States pressure Bulgaria to deport the Hamas delegation?

MS. NULAND: As I said, it was a sovereign decision for Bulgaria to make.

QUESTION: Okay. And lastly on this issue, Abbas just – Abbas, the President of the Palestinian Authority – said yesterday or the day before that the reconciliation talks are going forward and he’s going to form a government under his presidency that includes Hamas. Is that a good thing?

MS. NULAND: You know where we are on this issue. Our position has not changed. If we – if Hamas takes positions in the government, it will be very difficult if they do not do what is necessary, including recognizing Israel, renouncing violence, and all of those other things that we regularly state.

QUESTION: Do you think these statements are helpful to the prospects for peace talks, especially on the eve of a high-level visit by the President and the Secretary of State?

MS. NULAND: You know, Said, we’ve been here many, many times before. So we will obviously judge this by what actually happens.

Please. Can you tell me who you are, please?

QUESTION: Jake Gibson, FOX News.

MS. NULAND: Right.

QUESTION: Last night, Ambassador Rice was on The Daily Show, and she was – she said she was given bad intelligence regarding Benghazi for the Sunday talk shows on September 15th. Yet Defense Secretary Panetta testified on the Hill recently he knew immediately it was terrorist-related. How can – can you reconcile these apparently conflicting statements?

MS. NULAND: Sounds like those are questions for Ambassador Rice and the Pentagon, not for the State Department.

QUESTION: Can I get one more --

MS. NULAND: We’ve been clear about where we were on this, both in our – in the Secretary’s testimony and in previous testimonies.

Please, Jill.

QUESTION: Our daily question about Mr. Lavrov: Has he returned the phone call? Have you found him? Is he missing in action?

MS. NULAND: They have not yet connected by phone.

QUESTION: Seriously, I – we’ve been asking this for so many days.

MS. NULAND: Have you been asking of the Russians, I’m wondering, Jill?

QUESTION: Well, they never answer.

QUESTION: We couldn’t reach them.

MS. NULAND: Did you try?

QUESTION: But seriously --

MS. NULAND: That’s going down in one of my all-time top moments.

QUESTION: Doesn’t this --

MS. NULAND: Good for you, Brad.

QUESTION: -- amount to a rational person saying that they are doing the same thing they did with Secretary Clinton? I mean, this is getting kind of ridiculous, isn’t it?

MS. NULAND: Look, as we said at that time, as I’ve been saying all week, we’re making it clear that we would like to talk if they want to. If they are too busy or otherwise engaged, the offer stands, and we’ll continue to do other diplomacy.

QUESTION: Can I go back --

QUESTION: Is it --

QUESTION: You had told us about --

MS. NULAND: Yeah.

QUESTION: -- Secretary Kerry’s, I think, first conversation with Foreign Minister Lavrov. You had said, and I didn’t hear it properly at the time, that they began by talking about the importance of maintaining the relationship, of keeping lines of communication open.

MS. NULAND: Yes.

QUESTION: And I had thought you said that Secretary Kerry had said that, but you said no, both of them said that. Do you find this inconsistent with Foreign Minister Lavrov’s having said it was important to keep lines of communication open that he won’t take the call?

MS. NULAND: Again, I’m going to refer you to the Russians. But as I said earlier in the week, frankly it’s not unusual in our recent experience that when Foreign Minister Lavrov is far from his capital, he doesn’t return phone calls until he gets home. So what – how that – their system works is something to ask them about.

Said.

QUESTION: Toria, I know that Lavrov is not returning his calls, but has the American Ambassador in Moscow made an official request to the foreign ministry that we need to talk to Mr. Lavrov?

MS. NULAND: We have a regular system for making it clear that we’d like a phone call, and we are using that regular system.

Go ahead, Jo.

QUESTION: Staying Russia and Syria as well, there have been hopes that the Russians are extending an invitation to Syrian Foreign Minister Muallem and also to Syrian opposition leader Mr. Khatib. Now there’s a report out today in The Washington Post that, in fact, neither of them are going to go to Moscow. And so it would seem that that possible track is perhaps dead. Is that consistent with what you are hearing?

MS. NULAND: Again, we were tracking press reports that invitations had been offered. It was frankly never clear to us whether the Russians intended that they would come together and that they would somehow midwife something. But I will refer you to the Russians with regard to that.

We continue, when we can have the conversation, to talk to the Russians on multiple tracks, as I’ve said, first about cutting their support – military support and economic support – to the Assad regime, but also about joining us in supporting what al-Khatib has offered in terms of the talks with appropriately designated members of the regime about starting a transition.

QUESTION: What about on the three B track? We haven’t asked you about that for a while. Is there any movement on that?

MS. NULAND: Our – where we left this was that Mr. Brahimi would ask for another three Bs meeting – Brahimi, Bogdanov, Burns – when he thought it would be useful. He has not yet done that. So --

QUESTION: Does that suggest he doesn’t think it’s going to be useful?

MS. NULAND: I think he may well be waiting to see how the Russian position evolves, but we have to – I would refer you to him for what he’s thinking.

QUESTION: Do you have any comment on the offensive by rebels in a few different parts of the country over the last few days, or any assessment on how much ground they’re gaining?

MS. NULAND: Thanks for that, Brad. For those of you who follow the ground situation in Syria, after quite a period of some stasis, if you will, there now seems to be a pretty fierce opposition advance this week in particular. There’s now fierce fighting, as you know, around the Aleppo airport. The opposition appears to have overrun the airport security brigade. The regime is fighting back now with aerial bombardment; not only are they hitting civilians with that, they apparently have hit some of their own forces in the kind of indiscriminate response, which shows their desperation.

There’s also been very fierce fighting throughout the week not only south of Damascus, but also now to the east. So the opposition is coming at the city from two directions. And then there was the fall of Shaddadeh in the east to rebel fighters.

So obviously the Assad regime is under considerable pressure and fighting on multiple fronts now.

QUESTION: And now the million dollar question which we always ask you in this case: And what does this tell you about the course of the war, and do you have any feeling that the days that are numbered may actually be a finite number that we can count and the fall might happen anytime soon?

MS. NULAND: Well, Brad, we’ve all declined to get out our crystal balls because this is obviously very difficult and nobody could be predictive about it. But I think it does speak to the points that Secretary Kerry was making earlier in the week that Assad severely miscalculates if he thinks he has staying power beyond a certain point. And if he really cared about what was best for his country – at this point, if he cares about what’s best for those on his side – he would allow a process of political negotiations to begin.

Please, Samir.

QUESTION: Did you find out about this Iranian general who was killed in Syria a few days ago?

MS. NULAND: I did have something on that yesterday; I don’t today. But there are reports that a senior Iranian who was helping the Syrian regime was bumped off. Yeah.

Jill.

QUESTION: Toria, just in connection with Brad’s question --

MS. NULAND: Yeah.

QUESTION: There are some in the region now, some diplomats, who are saying that according to what they know, Assad does now understand the dire situation which he is in, which would be different from before where he thought that he could crush the opposition. Does the U.S. have any indication that that is – that he somehow has changed his understanding of what he’s involved in?

MS. NULAND: Well, any of us who claim to be inside the head of Bashar Assad would find themselves in a pretty dark place. I think when the Secretary spoke to this earlier in the week, he spoke about the importance of changing his calculation. Certainly these kinds of rebel advances, opposition advances and the kind of pressure that the Syrian military and the forces still loyal to him must be under can’t but help have an effect at least on his forces. Whether he gets accurate reports or not, I don’t know.

Please.

QUESTION: Victoria, you said that after a number of days of stagnant status on the ground, now it seems that the momentum now is shifting with the rebels. So if this continues and they have, like, large parcels of land, will the next step be to recognize the coalition as a government in transition?

MS. NULAND: Again, Said, you’ve asked this before.

QUESTION: Right. Right.

MS. NULAND: Obviously, we have to see how this develops. What we are seeking here is continued strengthening of the Syrian Opposition Coalition in terms of its links directly into political actors and liberated communities inside Syria, so together they can take this transition forward. The issue here is when we get to the point that we are really in a transition, then we can look at some of the questions you’ve been asking.

QUESTION: Okay. And last, very quickly: Qatar, yesterday or the day before yesterday, took the embassy, the Syrian Embassy, and turned it over to the rebels, the opposition. Is that a trend that we are likely to see?

MS. NULAND: I hadn’t seen that. That’s obviously a decision the Qataris are making.

I’m going to take one more from Lalit, and then I’ve got to fly.

QUESTION: This week, the number of Tibetans who have died because of self-immolation has crossed the hundred mark. Is the Secretary aware about this? And when he spoke to his Chinese counterpart earlier this week on North Korea, did this issue came up?

MS. NULAND: I think I reported that in his first conversation with Foreign Minister Yang, obviously the importance of continuing our human rights dialogue did come up. The conversation – the second conversation was purely about the DPRK, as I understand it, or primarily about it.

But we do note the horrific figures that you mentioned, Lalit, and we remain deeply concerned by the reports that these immolations are continuing. We call on those who are immolating or those who might be considering this to think hard about whether it’s the best way to express yourself. And we also, as we always do, call on the Chinese Government to address its own policies in Tibet that have caused these kinds of tension and frustration.

Thanks very much.

QUESTION: Do you see any move on the part of the Chinese to address the Tibetans concerns on this?

MS. NULAND: I think you can tell from the situation that it remains quite tense.

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